If you need to invest in debt in long-term portfolio, go for dynamic bonds

If you are in credit opportunity funds, income funds or dynamic bond funds for a long-term goal, stay put

Debt fund investors are a worried lot today. For many, the current trailing returns on their investments are below expectations due to the turn in the interest rate cycle. Most long-term funds have taken a hit over the past few months. In February, returns from many income and dynamic bond funds turned negative.

To make matters worse, fund managers say that volatility may continue in the near future. “There’s no certainty on whether things will stabilise anytime soon. The factors affecting bond yields need to stabilise,” says Mahendra Jajoo, head-fixed income, Mirae Asset Mutual Fund.

In the current uncertain scenario,